Michigan ranks among lowest states for export growth
According to the latest numbers on international trade released by the World Trade Organization, in the first 11 months of 2014 the value of world merchandise exports edged up 1.6 percent to $15.6 trillion from the same period in 2013.
WTO’s trade figures on exports from January-November 2014 show that China was the world’s leading exporter last year, selling $2.12 trillion worth of exports, or 5.7 percent more than the same period in 2013.
The United States ranked as the second largest exporter in the world with foreign sales hitting $1.5 trillion during the first 11 months of 2014.
Germany, the export engine of the European Union, maintained its third place posting $1.4 trillion in foreign sales through November 2014, which represents 4.5 percent more than in 2013. Japan was ranked as the world’s fourth largest exporter, selling $633 billion of merchandise abroad last year, which was 3.5 percent less than in 2013.
The four-country combined value of exports accounted for one-third of all exports in the world in the first 11 months of 2014.
Looking at the state’s export performance, foreign sales from Michigan's exporting companies dipped 0.2 percent in November from the previous month, following an increase of 2 percent in October.
Michigan's numbers on exports are adjusted for seasonal variation by e-forecasting.com — a statistical process that smoothes out monthly statistics for factors such as the number of days in a month and holidays, thus making them comparable to national and international metrics.
Last November, $4.37 billion worth of goods were shipped from Michigan to foreign markets, which is $6.7 million less than the value of exports recorded in October.
Manufactured goods led foreign shipments, accounting for 84 percent of all state exports. Sales abroad from Michigan's manufacturers increased in November by 1.8 percent from the previous month to $3.69 billion, adjusted for seasonal variation.
On an annual basis, exports from state factories were $806.7 million — or 16.3 percent — lower than in November 2013.
Exports of non-manufactured goods dipped 9.5 percent in November to $684.2 million, adjusted for seasonal variation. This group of shipments abroad consists of agricultural goods, mining products and re-exports, which are foreign goods that have entered the state as imports and are exported in substantially the same condition.
During the January-November period of 2014, national exports of goods have increased by an annual rate of 2.7 percent from the first 11 months of 2013, compared with annual growth rates of 2.1 percent in 2013 and 4.2 percent in 2012 over the same periods.
How did Michigan's companies fare in export growth so far in 2014, which in turn impacts local jobs and economic development? During the January-November period, exports of goods from Michigan, seasonally adjusted, decreased by an annual rate of 4.6 percent from the same period of 2013. Consequently, Michigan ranked 42nd in export growth among states during the first 11 months of last year.
The prospects over the next few months for exports of manufactured goods depend on the pace of incoming orders from foreign buyers. According to the December business survey conducted by the Institute of Supply Management, the nation’s purchasing executives continue to be optimistic about the prospects of selling their products abroad.
The Tempe, Ariz.-based research institute reported that its export indicator showed an expansion in incoming export orders for the 25th month in a row. However, the December reading of its export gauge also indicated that orders from abroad were growing at a slower pace than in November.
In the December survey, from the pool of respondents of the largest manufacturers that sell their products abroad, 14 percent reported greater export orders from November; 76 percent reported no change in export orders from the previous month; and 10 percent reported smaller export orders from November.
Evangelos Simos is chief economic adviser of the consulting and research firm e-forecasting.com. He can be reached at email@example.com.